Securitization

connor08

My mortgage with kensington was a part of securitization) then it was sold to pepper engage credit i have only heard today about something to fo woth securitization but i am confused  kensington confirmed to me that my mortgage was securitized in 2021 but sold to pepper engage credit what does this c,laim mean and how do you go about it 

Edi81

What claim? 

Securitisation (spelt with an s in the UK) is simply a way for lenders to get money today for the repayments you will make over time. 

Nothing nefarious going on for you as a borrower. 

silvercar

You don’t need to do anything. Kensington have sold a block of mortgages, including yours, to Pepper engage credit. So your mortgage is now with Pepper. Nothing should change for you in terms of your mortgage terms and conditions.

MWT

connor08 said:

My mortgage with kensington was a part of securitization) then it was sold to pepper engage credit i have only heard today about something to fo woth securitization but i am confused  kensington confirmed to me that my mortgage was securitized in 2021 but sold to pepper engage credit what does this c,laim mean and how do you go about it 

If someone is claiming that they can get your mortgage payments reduced or the mortgage written off just because it was 'securitized' then do not get conned into paying them to handle a claim for you.

user1977

The OP has umpteen previous threads about their mortgage (including at least one mentioning "securitization" so not sure why they now seem to think it's a new topic).

kingstreet

A mortgage isn't "sold" on its own. Lenders securitise a block of similar accounts in what's known as a residential mortgage-backed security, or RMBS. The terms and conditions continue as before with the new owner of the security being entitled to the payments, usually for a fixed period.

tifo

Edi81 said:

Nothing nefarious going on for you as a borrower. 

It is nefarious.

Mortgages are sold under the Law of Property Act but the customer is not notified, it's about assignment. The banks are selling the future income from the mortgage, i.e. interest.

In the UK assignment is not complete until the customer is notified (Notice of Assignment) and in this case the mortgage is sold but the sale is not completed as they never notify the customer. Thus the buyers of the mortgage receive benefits from the mortgage which is the interest etc and the lender administrates the mortgage on their behalf.

It is legal but assignment was never intended to be used in this way. So in repossession proceedings the lender will put their own name but they actually don't own the rights to the mortgage but the buyer will never name themselves as it is not one but many who have purchased the rights under assignment.

Securitisation came up after the 2008 'crash' and especially in the USA where assignment is completed in a different way (once assigned it is complete no 2 process like in UK) so it came to light that most lenders were not owners of the mortgages thus the customer did not have to pay back the mortgage. There were many repossession cases on this.

It is the same as assigning credit card and other unsecured debt. The lender will notify the customer that they have sold the account to a debt agency who will also notify the customer that they are now the legal owner of the debt (that notice complete the assignment). Sometimes the 2 letters come in the same envelope. In the case of mortgages neither the lender or the buyer inform the customer (that's the nefarious part) but use the law to their advantage and sell the mortgage but do not complete the assignment.

For example, my mortgage lenders letters state 'as administrator' but they've never informed me that they sold the mortgage and i've never heard from the buyers of my mortgage. In my transactions some time ago I saw that the mortgage was sold around every 5 years (my mortgage balance goes to £0.00 then added again some days later) which is a usual term for a mortgage backed bond to mature but they can be for up to 15 years. At maturity it's repackaged and sold again.

For me the bank's transactions don't show the zero balance then it being added (securitised) and I only know because of a charges/fees claim some time ago at the Ombudsman, who sent me a printout of transactions and the balance being zero and being added again was in those. Maybe he wasn't supposed to send me that info but he did. The bank keeping it off my transactions is nefarious but they all do that as they don't want you to know the mortgage is securitised.

ACG

Im fairly sure lenders write out to notify customers of the change.